Senator Hagerty to Introduce Stablecoin Legislation Targeting Tether Transparency

Senator Bill Hagerty will introduce legislation Tuesday to create a comprehensive regulatory framework for stablecoins, marking the latest Republican push to establish crypto-friendly policies.

Senator Bill Hagerty (R-TN) will introduce legislation Tuesday to create a comprehensive regulatory framework for stablecoins, the latest Republican push to establish crypto-friendly policies.

The bill, to be introduced and seen by Bloomberg, would set rules for stablecoin payments, requiring issuers to back tokens with U.S. currency, Federal Reserve notes, Treasury bills and other assets.

The legislation, dubbed the GENIUS Act (Guiding and Establishing National Innovation for US Stablecoins), would also require stablecoin issuers to submit monthly audited reports on their reserves and imposes criminal penalties for providing false information.

The focus on transparency comes as the stablecoin market has exploded to $205 billion, with Tether’s USDT token maintaining market dominance at a $140 billion market cap.

Tether’s market position is particularly noteworthy given Cantor Fitzgerald’s stake in the company, led by incoming Commerce Secretary Howard Lutnick.

This legislative push comes amid increasing scrutiny of Tether’s reserves and broader concerns about stablecoins’ capacity to withstand large-scale redemptions, underscoring the urgency for clear regulatory oversight.

Its closest competitor, USDC, holds a market cap of $54 billion, according to CoinGecko data, highlighting the significant scale and influence of these issuers in the financial ecosystem.

“My legislation establishes a safe and pro-growth regulatory framework that will unleash innovation and advance the President’s mission to make America the world capital of crypto,” Hagerty said in a statement.

The bill has garnered bipartisan support, with Senators Kirsten Gillibrand (D-NY), Tim Scott (R-SC) and Cynthia Lummis (R-WY) serving as co-sponsors.